The Commercial Real Estate Alpha Site

Some really good insight and guidance from Palm Companies.

Investment Commentary by principals Josh Diggs, Dan Pepper, Rachael Munkwitz

As operating costs rise with cost-of-living increases, we’ve noticed a particular spike in water & sewer expenses.  A few tips that we find effective:

• If your property has water submeters, take 1 reading of each submeter, then another reading in 1 week.  If any meter’s consumption is over 2000 gallons, visit the unit to replace toilet flappers & running faucets.

• If your property only has a main meter, inspect each unit to replace toilet flappers & running faucets where needed.  Install low-flow water fixtures now or during a turn.  

• After 1 month, if water consumption remains high, look for unexplained wet areas in your parking lot & around each building’s foundation.  Consider hiring a leak detection company, especially if you have a pool.

• Offset your water expense by billing to residents in 1 form or another.  If you have submeters, charge based on each unit’s actual usage.  If not, you can bill using a 3rd-party RUBS billing system, or simply charge tenants a per-occupant monthly fee in addition to rent.